Exhibit 10.1



CuraGen Corporation
 
 555 Long Wharf Drive, 11th
 Floor
 
 New Haven, Connecticut 06511

Ladies and Gentlemen:

Pequot Partners Fund, L.P. and Pequot
   International Fund, Inc. (collectively, "Pequot") each
   agrees to buy 750,000 shares of CuraGen Corporation ("CuraGen
   ") common stock, $.01 par value per share, (the "Shares
   ") at a price per share equal to $10.00. CuraGen agrees to sell
   the shares to Pequot. On or before September 8, 1999, Pequot shall
   wire an aggregate of $15,000,000 in immediately available funds to
   an account designated by CuraGen and CuraGen shall deliver into
   escrow with American Stock Transfer and Trust Company stock
   certificates evidencing the Shares (and on or before such date
   copies of such certificates shall be faxed to Pequot). On or before
   September 9, 1999, contingent only upon CuraGen' s receipt of the
   purchase price on September 8, 1999, CuraGen shall cause the Shares
   to be delivered to Pequot.



1. Pequot represents and warrants to
   CuraGen that it is acquiring the Shares for its own account for the
   purpose of investment. Pequot is not acquiring the Shares with a
   view to, or for resale in connection with, a distribution, nor with
   any present intention of distributing or selling the Shares and
   understands that the Shares have not been registered under the
   Securities Act of 1933, as amended (the "Securities Act"),
   or the securities laws of any state. Pequot understands that until
   the Shares have been registered under the Securities Act and
   applicable state securities laws each certificate representing such
   Shares shall bear a legend substantially similar to the following:





2. Pequot represents and warrants to
   CuraGen that each entity is an "accredited investor" as
   such term is defined in Regulation D under the Securities Act.

3. Each of Pequot and CuraGen
   represents and warrants to the other that (i) it has the right and
   power under its charter and bylaws or other organizational documents
   to execute, deliver and perform its obligations hereunder; (ii) this
   Letter Agreement has been duly authorized by all necessary corporate
   or partnership action, and (iii) the officer executing and
   delivering this Letter Agreement has the requisite right, power,
   capacity and authority to do so on behalf of such corporation or
   partnership. CuraGen represents and warrants to Pequot that on or
   before September 14, 1999, the Shares will be approved for listing
   on The Nasdaq Stock Market.



Pequot and its "affiliates"
   or "associates" (as such terms are used in Rule 12b-2 of
   the Securities Exchange Act of 1934, as amended (the "Exchange
   Act"), these terms to have such meaning throughout Sections B
   and C) hereby agree that, without the prior written consent of
   CuraGen, they will not, during the period commencing on the date
   hereof and ending on March 8, 2000, (1) offer, pledge, sell,
   contract to sell, sell any option or contract to purchase, purchase
   any option or contract to sell, grant any option, right or warrant
   to purchase, lend, or otherwise transfer or dispose of, directly or
   indirectly, any of the Shares or any securities convertible into or
   exercisable or exchangeable for the Shares or (2) enter into any
   swap or other arrangement that transfers to another, in whole or in
   part, any of the economic consequences of ownership of the Shares,
   whether any such transaction described in clause (1) or (2) above is
   to be settled by delivery of shares of CuraGen common stock or such
   other securities, in cash or otherwise. The foregoing sentence shall
   not apply to the transfer of the Shares by Pequot to its "
   affiliates" or "associates," provided, that, the transferee(s), agrees in writing as a condition precedent
   to such transfer to be bound by the terms of this Letter Agreement.

Pequot understands that the Shares
   shall bear a legend substantially similar to the following:



> C.
>    Standstill

1. Pequot agrees that for a period of
   three years from the date hereof, Pequot will not, nor will it
   permit any of their affiliates or associates, from and after the
   date that such person becomes an affiliate or associate, unless in
   any such case specifically invited to do so by the Board of

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Directors of CuraGen to: acquire, announce an intention to acquire,
   offer or propose to acquire, solicit an offer to sell or agree to
   acquire by purchase, by gift, by joining a partnership, limited
   partnership, syndicate or other "group" (as such term is
   used in Section 13(d)(3) of the Exchange Act, such term to have such
   meaning throughout this Section C) or otherwise, any shares of
   CuraGen common stock, or any other CuraGen securities convertible
   into, exchangeable for or exercisable for CuraGen common stock (all
   such securities, collectively, "Voting Securities"),
   except that the foregoing shall not apply to the purchase of the
   Shares pursuant to this Letter Agreement.

2. Notwithstanding the limitations and
   restrictions set forth above in Section C(1), Pequot shall have the
   right to acquire Voting Securities which, when added to the Voting
   Securities already owned by Pequot (including the Shares), would
   constitute not more than 15% of the number of shares of CuraGen
   common stock reported by CuraGen to be outstanding in the Company's
   most recently available filing with the Securities and Exchange
   Commission or other public announcement.

> D.
>    Miscellaneous

1. Pequot acknowledges and agrees that
   irreparable damage would occur if any of the provisions of Sections
   B and C were not performed in accordance with their specific terms
   or were otherwise materially breached. Accordingly, CuraGen will be
   entitled to an injunction or injunctions to prevent breaches of
   Sections B and C and to enforce specifically its provisions in any
   court of the United States or any state having jurisdiction, this
   being in addition to any other remedy to which CuraGen may be
   entitled at law or in equity.

2. No failure or delay on the part of
   CuraGen in the exercise of any power, right or privilege hereunder
   shall operate as a waiver thereof, nor shall any single or partial
   exercise of any such power, right or privilege preclude other or
   further exercise thereof or of any other right, power or privilege.

3. Pequot understands that the Shares
   shall bear a legend substantially similar to the following:



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4. This Letter Agreement may be
   executed in one or more counterparts, each of which shall be deemed
   an original, but all of which together shall constitute one and the
   same instrument.

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IN WITNESS WHEREOF, the undersigned
   have executed this Letter Agreement on September 7, 1999.

| | PEQUOT
     PARTNERS FUND, L.P.
| | -------------------------------
| | By: /s/ David J.
     Malat    
| | David J. Malat                 
| | PEQUOT INTERNATIONAL FUND, INC.
| | By: /s/ David J.
     Malat    
| | David J. Malat                 
| | CURAGEN CORPORATION            
| | By: /s/ David M.
     Wurzer   
| | David M. Wurzer                

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